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Tuesday, October 31, 2017

The Influence of Robots on Unskilled Labor

Unskilled labor and robots are on a crash course that is likely going to make such labor less valuable and cut wages. The explosion in robot technology over the past decade has made the initial expense of such equipment worth it when we add in the cost of labor over the lifetime of such initial investments. While robots can bring back manufacturing to the U.S. it will displace vulnerable workers.

The temptations to use new technology that inevitably becomes cheaper over time is too great when we consider national competitiveness and return on investment. Yet one must wonder where certain sectors of the population will work if they do not have living wages and cannot afford expensive education programs. At some point class consciousness and their reckoning will be increasingly likely.

Reduction of Cost and Competitive American Manufacturing

The advantages of technology to clean stores, build items and move them around distribution centers creates opportunities to earn higher profits. With this technology, and perhaps some tax reform, we can bring back manufacturing. Where China competes on low skilled and low cost labor they are stunted by poor infrastructure. The Chinese are pouring billions into infrastructure improvements while the U.S. already has an infrastructure advantage but doesn't have access to cheap labor.

Robots Displace Low Skilled Labor

Low skilled labor will need to continuously compete against emerging technology. Those with just a high school diploma, and no technical training, will find their job opportunities and wages decline. A growing underemployed class will be created that will need cheaper and more effective training and education to keep them in the workplace. At some point, as technology emerges the skilled with high income and the unskilled with poverty wages will define new class consciousness.